CoinDesk
Swift’s blockchain-based ledger can move tokenized deposits across borders around the clock, but banks need their own permissioned ledger, digital-asset wallets, and tokenization and smart-contract capabilities to connect. Taurus co-founder Lamine Brahimi said the system acts as an orchestration layer, not a replacement for banks’ internal systems or existing settlement arrangements.
Why it matters
Swift said in July that 17 banks were preparing live tokenized-deposit transactions. HSBC and Standard Chartered completed the first live interbank transaction on the ledger in August. DBS and Citi later executed a weekend cross-border dollar payment in minutes, compared with up to two business days through traditional processes.
Swift has dominated financial messaging since the 1970s and handles money movements of up to $1.5 quadrillion a year. Its ledger adds a way for banks to offer round-the-clock payments while keeping deposits on their balance sheets and continuing to use existing settlement arrangements.
Market impact
The model depends on compatible infrastructure at both ends of a payment. Banks that already issue or manage digital assets may find the additional technology less of a hurdle, while others need to build or source the required ledger, wallet, tokenization, and smart-contract tools.
Brahimi described the ledger as an early-stage product that gives banks a choice between existing payment rails and tokenized deposits. Taurus announced its Swift integration in August and says its platform provides the required capabilities. The completed transactions demonstrate a route to faster, weekend cross-border payments, while broader use depends on banks having the infrastructure to connect.
Frequently asked questions
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What infrastructure do banks need to connect to Swift’s ledger?
Banks need a permissioned ledger, digital-asset wallet capabilities, and tokenization and smart-contract tools to connect.
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Does Swift’s blockchain ledger replace banks’ internal systems?
No. It acts as an orchestration layer for payments, while banks retain their internal systems and existing settlement arrangements.
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Which banks have completed live transactions on the ledger?
HSBC and Standard Chartered completed the first live interbank transaction. DBS and Citi later executed a weekend cross-border dollar payment.
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How quickly did the weekend cross-border payment settle?
The DBS and Citi payment settled in minutes, compared with up to two business days through traditional processes.
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How do tokenized deposits differ from stablecoins in Swift’s model?
Tokenized deposits in Swift’s model remain on banks’ balance sheets, unlike stablecoins issued outside the banking system.
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